Miscalculated Overtime Lawsuits

At A Glance

This Alert Affects:

Anyone who earns bonuses, shift pay differentials or other types of compensation in addition to their hourly wage.

What's Going On?

Some employers are failing to take into account bonuses, shift pay differentials or other types of compensation when calculating employees' overtime pay rates. As a result, workers are being cheated out of wages – and some are filing lawsuits to get their money back.

What You Can Do:

Do If you think your overtime pay is being miscalculated, fill out the form on this page to get in touch. One of the attorneys we work with may then reach out to you directly to learn more about how you're getting paid and whether you're missing out on wages. There's no cost to talk to an attorney and you're not obligated to take legal action after speaking with one.

Can I Get Fired?

Federal law prohibits employers from firing, demoting or otherwise retaliating against employees who report overtime violations or otherwise exercise their legal rights.

Lawsuits are being filed on behalf of employees who say their overtime pay rates aren’t being calculated properly and that they’re missing out on wages as a result.

They claim their employers are leaving out additional forms of compensation, such as bonuses, when calculating their regular rates of pay – which are used to determine the “time-and-a-half” or overtime pay rate – in violation of federal law. The workers are suing so that they can recover the wages they lost as a result of the miscalculation and to help ensure they get paid properly when working overtime in the future.

What Should Be Included in Overtime Pay Calculations?

The Fair Labor Standards Act (FLSA) sets the rules and regulations for overtime pay, who receives it, and how it must be paid. The Act states that, for the purposes of calculating overtime pay, the employer must take into account the following.

Bonuses

The FLSA states that non-discretionary bonuses paid during the pay period must be included when determining an employee’s regular rate of pay. Non-discretionary bonuses are those given to employees to encourage them to work more efficiently and to stay at their jobs.

Non-discretionary bonuses paid over a series of pay periods must also be included. For instance, assume a hospital gives its nursing assistants a $5000 bonus after being employed for six months. That amount must be taken into account if the nurse works overtime during that six-month period.

Shift Differentials

Employers must also take into account shift differentials when calculating overtime. This includes premium pay for night shifts. For instance, if an employee works two eight-hour shifts at a pay rate of $15 and three eight-hour night shifts for $20 each, both forms of compensation must be taken into account when determining his or her overtime pay rate.

Multiple Rates of Pay

Assume a receptionist works during the week for $10 an hour, but fulfills advertising and social media services for the same company on the weekends at a pay rate of $15 per hour. Both rates of pay must be included when calculating his or her overtime rate.

What Pay Is Not Included for Purposes of Calculating Overtime?

Regular rates of pay do not include:

Money paid as gifts for the holidays, birthdays or other special occasions

Premium payments for overtime or holiday/weekend work

Life insurance or health benefits

Travel expenses, laundering costs and supply/material purchases

Sick or vacation pay

Lawsuit Examples: What Workers Have Taken Action?

Lawsuits have been filed on behalf of the following types of workers who claim their overtime pay was miscalculated:

Nursing assistants

Jewelry retail store workers

Apartment and residential management workers

Service technicians

Retail workers and consultants

Retirement community workers

Brewery workers

Overtime Miscalculated? Here’s What You Can Do

If your regular rate on your paystub is strictly your hourly rate – and does not include bonuses or other forms of payment – you may be getting cheated out of overtime wages. To find out what you can do about it, get in touch with ClassAction.org by filling out the form on this page. After you contact us, one of the attorneys we work with, who are some of the country’s leading employment attorneys, may reach out to you directly for more information, including how you’re being paid and how many extra hours you’re working. It doesn’t cost anything to talk to a lawyer and federal law prohibits your employer from retaliating against you for exercising your legal rights.

Case Resources

Read an example of a lawsuit filed by a group of New Jersey nursing home employees who say their overtime pay was miscalculated because the healthcare provider failed to include their pay differential.

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